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Weekly Roundup: Header Bidding Vs Google’s Unified Auction, Adtech Tax, and More.

Adtech Weekly Roundup
Header bidding has evolved, just like the ecosystem and RTB protocols.

Google banned ads on 28M pages, plans new Policy Manager this year

Google, the largest of them all, raked in $32 billion in revenue last quarter. When you hold a prodigious market share, you have to deal with a lot of fraud and nefarious side of the market too.

Google published its internal takedown numbers last week and here are the highlights.

2.3 billion – “Bad ads” have been trashed by Google’s manual review team and machine learning algorithms in 2018.

1.5 million – Apps are completely banned from using Google’s ad network/technology to monetize.

28 million – Web pages are banned from displaying any ads served by Google.

If you think 28 million is pretty big, according to Google Inside Search, there are more than 60 trillion pages (crawled and discovered by Google) and this number is constantly growing. So, that’s just 0.003% of the total pages Google know of. 

Bigger Picture

Google has started to improve its ability to identify and purge the bad ads by looking at the source of the problem, rather than focusing on the problem.

Accounts > Ads

For instance, Google reported that it took 3.2 billion ads in 2017, which is almost a billion more than last year. It doesn’t mean Google left out the bad ads, it terminated more bad accounts instead. Nearly 1 million accounts were removed in 2018, double the figure in 2017. This means bad ads are not hitting the network in the first place.

Publishers > Web pages

In addition, Google shut down 734,000 publishers that violated policies. The company developed 330 new “detection classifiers” to weed out the non-compliant pages and publishers.

Introducing the Policy Manager

To prevent non-compliant ads from being created, Google is rolling out a new tool called “Policy Manager” where advertisers can get the warnings/errors instantly while creating the ad.

Google Policy Manager

Takeaway:

Google’s Policy Manager is planned for Google search ads and we predict they will extend it to display/video ads. Content involving misrepresentation, fake news, hatred, etc. were also banned by the network. Just keep an eye on your content and Google’s policies.

Header Bidding Vs Google’s Unified Auction

It’s been all around the news. Google is shifting to first-price auction and most in the industry would be affected by it. From publishers to media buyers to ad tech vendors, everyone is trying to figure out what the move actually means and how it’s going to impact their bottom line (both short-term and long-term).

State of Header Bidding

As usual, there are two arguments here. With the new unified first-price auction, Google wouldn’t know the “price to beat” and this puts header bidding wrappers in a thriving scene says Chris Kane, founder of Jounce Media to AdExchanger.

On the other hand, some predict that unified auction will eventually replace header bidding as publishers can get what header bidding promises today – unified auction.

We think unified auction will send a wave across the ecosystem (buyers will reconsider their bidding strategies, publishers will amend their price floors, ad tech vendors use their technological prowess to hold their market share), but header bidding won’t be replaced, at least the server-side of it.

Here’s our reasoning. Publishers (majority) adopted header bidding because of unified and unbiased auctions. And, then there’s transparency. Google has to provide all of them. 

Next, in order to shift everything to ad server and conduct a truly unified auction, we need to address the cookie syncing problem (or match rates). Identity solutions aren’t ready to replace the cookies yet. This puts Google in a better position (in the unified auction), as it gets the call from the browser directly.

Last but not least, hybrid header bidding implementation is on the rise. Though it’s a bit complicated, it increases bid density and page load speed at the same time.

Takeaway:

Header bidding has evolved, just like the ecosystem and RTB protocols. It won’t be easy to replace it, especially without addressing the aforementioned problems.

Not an apple to apple comparison, but we couldn’t find a better one – Rubicon’s header bidding attempt started back in 2012 (Real-time Pricing, now called as Fastlane), before the existence of open-source wrappers like Prebid. But many adopted prebid (because it’s transparent, unified, and unbiased).

Reducing adtech tax

Recently, TrustX announced that it’s shifting its ad tech tax for the buyers. After a three-month partnership with Meredith, NBCUniversial, CBS Interactive, and Magna Global, TrustX believes that the fee will attract and retain the top media buyers.

The 12.5% fee will be absorbed by the publishers. TrustX argues that the publishers will see the increasing media spending from the advertisers via TrustX, in the long run. This, in turn, helps the publishers to accrue better revenue from TrustX.

#1 The rise of Google, Facebook, and Amazon have put all the players in a zero-sum game.

It is a fact that the ad tech vendors (buy-side or sell-side) are finding it difficult to compete and retain the market share. To thrive, reducing what you charge (ad tech fee) seems to be a sensible choice, at first.

Let’s say you’re a buy-side tech vendor and you brought down the fee to 8% from 12% with the hope of onboarding more buyers, you are essentially agreeing to eat the loss (decreased profit) until you scale your client-base considerably.

But most players in the industry would likely end up reacting in the same way. This means your competitive advantage is now gone. You wouldn’t be able to scale up and worse, will end up running with the new decreased fee.

The better way is to focus on the product (new or better features). The Trade Desk is able to run with 18.5% take rate until today because of its products and services. Besides, TrustX isn’t eating the loss, it rather shifts it to publishers.

#2 No one likes to pay the middlemen unless it is necessary.

On the other side, there is a probability for TrustX to pull this out successfully. Of course, we have to assume the rate of acquisition is faster and media buyers decided to stay. Most importantly, publishers would accept the extra fee implied for the long-term benefits.

“Publishers can see where all the bids are coming from. Any time they see a dollar bid come in from TrustX, they won’t view it as a dollar and the more rational choice will be to accept money from another sell-side platform.”

–  Chris Kane, founder of consultancy Jounce Media.

Takeaway:

Publishers should undeniably work towards the long-term results. That being said, as a publisher, you should assess the risk – whether it is worth it or not. It depends on the goals and market value of your ad impressions.

Moments That Matter

Complex malware found in ad networks, cybersecurity firm reports – AdWeek.

Social media spend will grow 44% by 2021 – eMarketer.

Sizmek is probing an account breach – Krebs On Security.

Automatad Team

At Automatad, we help publishers to monetize better without hampering the user experience. Our products are live across hundreds of publishers, earning them incremental ad revenue with every passing second. You can request a free audit to get an estimated revenue uplift today.

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